With $187 Billion At Stake, Don’t Neglect Employee Productivity Investments

If retailers aren’t already investing in employee productivity, they should start now. They could collectively be missing out on as much as $187 billion, according to research from Cisco.

Just 6% of retailers’ investment priorities are focused on employee productivity use cases, such as checkout optimization, remote mobile experts, smart lockers, interactive kiosks and next-generation workers — despite the fact that Cisco estimates that these use cases deliver the greatest ROI for retailers.

Employee productivity’s $187 billion value far surpasses any investment retailers could make through 2018:


  • Innovation: $131 billion;

  • Customer experience: $91 billion;

  • Asset utilization: $54 billion;

  • Supply chain and logistics: $38 billion; and

  • Sustainability: $5 billion.

Cisco identifies three phases for retailers on the road to a digital transformation: 1. Enable digital capabilities; 2. Differentiate their brand through new digital capabilities; and 3. Define new business models through digital disruption.

Nearly half (49%) of retailers prioritize their current investments in the technologies and use cases in the “Enable” phase of the digital roadmap, such as mobile payments and engagement. However, Cisco research shows that only 42% of the value to retailers lies in this phase. Cisco recommends that brands in this phase invest in BYOD, Labor Optimization and Virtual Training use cases.

Retailers are not investing enough in the areas that create competitive differentiation and new revenue streams, the report notes. Only 29% of retailers’ investment priorities are currently focused on the “Differentiate” phase, with only 22% in the “Define” phase. These are the more advanced phases of the roadmap, where retailers can differentiate their brand based on unique digital capabilities and services, or define new business models and revenue streams through digital disruption.

Department Stores Still Stuck In ‘Enable’ Phase

In 2016, Cisco evaluated the progress retailers are making on digital investment prioritization, hosting a series of sessions with 200+ retail executives representing more than 120 global retailers. Some retail sectors are further along the path to digital transformation than others. For example, a mixed group of retailers, including department stores and other brands from the southern U.S., attending a session held in Dallas, Texas, said they were making higher investments in the “Enable” phase (61%).

However, less than half (42%) of retailers attending a session held in New York, N.Y., consisting primarily of apparel manufacturers/retailers, are still investing heavily in the “Enable” phase.

The results indicate that apparel retailers are heavily focused on innovation and should balance their digital roadmap investments by investing more in operational efficiency — with, for example, use cases that will improve distribution, production times, retailer insights and use of data.

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